Mercosur agreement urgently needed

"If you negotiate with Europe, you get a lecture. If you negotiate with China, you get a port. Just how much truth there is in this saying can currently be seen in Peru. There, you can watch Europe losing ground geo-economically and China gaining it virtually in real time. This is mainly due to the impending failure of the EU's Mercosur trade agreement with the four Latin American countries while at the same time China expands its maritime Silk Road to the west coast of Latin America.

The significance of the container port Chancay in Peru, which was built by China, goes far beyond the fact that it will halve freight times from China to Latin America's west coast. It is of great geo-economic importance.

Once the connection projects for a rail line and roads to Brazil are completed, Latin American trade with Asia will shift away from the Atlantic and the route through the Panama Canal, which is closer to the US, directly to the Pacific. As a major operator of Chancay, the Chinese state shipping company COSCO is closing a gap in its network of port holdings around the globe with its logistics technology and expertise. It is thus exerting influence on the control of spaces, routes and resources in line with the physical, maritime and digital Silk Road strategy pursued by the Chinese leadership.

This should be a wake-up call for the EU and its negotiations on free trade agreements with Latin American countries, which have dragged on for decades. In the competition for access to important resources from Latin America, China has created facts with Chancay. At the same time, the Mercosur agreement is on the verge of collapse due to resistance from France and its farmers, supported by Italy. In order to survive in the geo-economic showdown with the Donald Trump led US as well as China, the EU must now do everything in its power to reach a successful agreement with Mercosur.”